The Federal Communications Commission has approved Paramount Skydance\u2019s request to allow substantial foreign investment in its proposed acquisition of Warner Bros. Discovery, clearing another regulatory hurdle for one of the largest media deals in recent years.<\/p>\n
The FCC\u2019s Media Bureau approved indirect, non-voting ownership stakes for investors tied to Saudi Arabia, Qatar and the United Arab Emirates. Paramount has said foreign investors could hold roughly half of the combined company\u2019s equity if the transaction closes.<\/p>\n
The three Gulf investors have committed about $24 billion toward financing the deal. Because Paramount owns CBS and U.S. broadcast stations, foreign ownership above certain levels requires FCC approval.<\/p>\n
The commission concluded the investment was in the public interest, citing Paramount\u2019s assurances that the foreign investors would not receive voting rights or control over programming, management or other corporate decisions.<\/p>\n
Paramount said the Ellison family and RedBird Capital would retain control of the combined company and hold all voting power.<\/p>\n
The ruling drew criticism from FCC Commissioner Anna Gomez, the commission\u2019s lone Democrat, who argued that the size of the investments could still give foreign governments influence over a major American media company. She also criticized the decision being handled at the staff level rather than through a vote of the full commission.<\/p>\n
The foreign-ownership approval does not resolve a separate antitrust fight over the merger.<\/p>\n
The U.S. Department of Justice previously completed its review and declined to challenge the transaction, concluding that the merger was unlikely to harm competition in streaming, television or film production and distribution.<\/p>\n
California Attorney General Rob Bonta and attorneys general from 11 other states have nevertheless sued to block the deal, arguing that combining Paramount and Warner Bros. Discovery would reduce competition and consumer choice. The Writers Guild of America has filed a separate challenge.<\/p>\n
Montana Attorney General Austin Knudsen and Iowa Attorney General Brenna Bird have asked the U.S. Supreme Court to intervene in the states\u2019 case, arguing that the multistate lawsuit is attempting to stop a transaction that has already cleared federal antitrust review and regulators in other countries.<\/p>\n
The state antitrust case is scheduled for trial in March 2027, and Paramount has agreed not to close the merger while that litigation proceeds.<\/p>\n
The FCC decision gives Paramount greater certainty over a major piece of the financing, but the court challenges remain the principal obstacle to completing the transaction.<\/p>\n